It is fascinating to see how quickly Augmented Reality (AR) is permeating our lives and the blogosphere. But what will the mass adoption of mobile devices that allow you to layer ‘virtual story worlds’ over the real world mean for new forms of entertainment & marketing? Also what will it mean when celebrities and audience/users, begin to merge – avatars appearing in broadcast TV and film/gamestars composited into our homes?

I have posted about the cross-reality evolution over the last 3 years on this blog under a general mixed-reality umbrella. Now we have every blogger & journalist talking about their AR engaged iPhone, DSi, PSP or smart mobile as if they have discovered some advanced alien technology. But is it really is a game changer, a new playground for storytellers? A window to another world at one end through to a simple layered utility at the other. Actors and fantasy characters deliver lines, embedded in real world scenes, you find the hidden virtual treasure, the historical or future backstories and clues, video, sound, images – even fellow ‘players’ morph into strange aliens or dissapear, you leave red herrings or leave help for other players the possiblities, endless.

Social Media and Web 2.0 is a lot about providing the tools and therefore the means for everyone to create content, that they believe others may want to see. I have personally created a lot of corporate, professional entertainment and music films over the years using high end equipment but now, like many millions around the world, find it a fun and satisfying process to be able to create films and stories in virtual worlds, aka machinima. (Quite a few are over on my personal virtual blog justvirtual)

There are literally millions of machinimas emanating from the likes of World of Warcraft, Sims, Movies, Halo, Second Life, Half Life and many more. Most are done for the love vs the money and some make it onto the big screen. For the creators it is about expressing ‘their’ world and experiences to each other but of course there is something else as important here.

Laurel (heart) talked recently on a machinima I did in Twinity and about the ‘free advertising’ it offers for the brand or platform. For me it is also about creating an environment where simple tools encourage large numbers of people to come together remotely and do real-time, collaborative content creation for extended periods. It makes the world very, very sticky when they have shared creative goals and purpose – not just pre-constructed game play. Some may say game quests are social too and I believe when the players get ‘creative’ with the mechanic and ‘bend the rule’ together it certainly is.

Comfortably Fun

Using game or social virtual worlds to entertain each other in this deeply immersive way, leads us to imagine what the potential will be when bandwidth and graphic realism are no longer limitations. Perhaps a portent of the future here is a machinima I did of a forty three minute performance of Pink Floyd’s The Wall, in a social world, Second Life. It was captured last week and it is useful to remind us all what is going on here. There are around 70 people logged in together in real time from around the world, most audience a few performers. About 8 are ‘animating’ on stage or controlling lights, effects or triggering scripted animations and I am recording the whole thing at the same time. This is digital puppeteering. I captured elements of the performance three times and put together this compilation edit. More after the embed…

So this all started with an invite from a self motivated group, led by Debbie Trilling, who for the love of what they do, created an inworld, cross-reality, musical tribute. CARPs (Cybernetic Art Research Project) inventive and emotionally driven version of Pink Floyd’s 1980’s album was a truly international affair and many hours were spent developing and performing a Virtual Show to this music that reaches a new audience every few years.The reason the music reaches new audiences is because of its use in ‘community created content’ just like this, a far more poignent way to share digital content. More than 2000 avatars have experienced this particular concert inworld generating 10 000s of impressions across blogs and media sites. That is the key point – don’t dismiss game or virtual worlds as being irrelevant because of perceived low numbers – these are active and proficient online users who see the 2D web as a ‘simple’ publishing tool and become prolific creators of content and by implication major influencers.

Professional marketeers need to be aware of the power of machinima (consumer films in worlds they are very loyal too) and how by allowing the use of often locked down content is probably the best way to introduce ‘old’ content to new audiences. As an example, while I was putting together this ‘mash-up’ compilation I tried a recording of the reunion performance of the Comfortably Numb at Live 8 a few years ago and was entranced by the synergy of visual and song. Hope you do too. BTW a medium quality (90MB MP4) download of the YouTube above is available here. Worth playing full screen with the volume up and the lights down 🙂

To further consider how effective game world movies are. I created again out of a moment of relaxation a ‘flycam’ film around some of my ‘builds’ in Second Life. I like others were entranced by the new feature in the engine, Windlight. This rendered more naturalistic reflections and skyscapes for example. The machinima was a self expressive piece, some improvised guitar and piano and flowing movement, not really an typical ‘traffic’ generating video.

Ticking along at a few hundred views over a month on YouTube then Linden Lab decided to feature it on their machinima page. For a week or so it was getting between two to four thousands views per day. Over the past four months or so it has been viewed over 30 000 times, not bad for an ‘art’ video? But outside the numbers what is the dynamic at play here? Well it is really simple. If you own any space where people frequent, make it really, really easy for them to share their experiences. You scratch their back and they will yours. Give them the tools to make it easy to create professional looking content. Let them do the viral marketing for you. Even though the community realise they are doing you a ‘big’ favour, the joy they get from sharing is part of their own virtuous circle.

Although this new soon to be ubiquitous virtual world is not as vastly customisable as Second Life it has some nice useful, linear machinima features such as the rather quaint preset animations and its obvious cartoon aesthetic. I just put together a quick sequence of some of the ‘solo’ animations of the toons up onto the LAMP YouTube channel and after that the couple anims which are quite compelling with more to come from 3rd party developers. With the unlimited ‘viewfinder’ camera positioning and mild set and avatar customisation alongside already thousands of ‘room/environments’ it does offer rapid machinima potential. It won’t be as ‘unique’ as some of the Second Life ones I (now at 200 000 views!) and others have made for example…But Google Lively has some nice off the shelf story environments (my wikipedia entry) which mean less set up as in ‘green field’ social virtual worlds and already story ideas are rearing their ‘lovely/lively’ heads 🙂

As promised a rough transcript of my keynote talk to CeBit last week based on my experience of actually building some Second Life sims, talking to those who use them and creating branded environments that have more usage than any others inworld, so far. There will be a video and/or podcast at some point from CeBit TV and linked from our Project Factory main site but for now lots of ‘nice’ words and this YouTube video I uploadedâ€¦

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Hello I’m Gary Hayes and thank you for inviting me here to speak at CeBit this afternoon. I hope that by the end of this very brief introduction to virtual worlds, and particularly Second Life, you will be more aware of the major changes that are happening to what we used to call ‘the web’. Virtual worlds are a new disruptive and transformative medium and one that is becoming a significant force alongside our traditional media experiences. But it is still early days. It is the silent movie era, a bit like TV in the late 40s or the web itself in the early 90s – but already virtual worlds are a place where the audience stops being the audience, who become and create their own stories. For those without any exposure to virtual worlds this talk will be a beginners guide and for those who already know something or a good deal about these 3D shared spaces there will perhaps be one or two surprises, Hopefully we will go inworld too if the connectivity gods are with us.

So what do we mean by virtual worlds. In very simple terms they are a bit like MySpace meets the Local Pub meets YouTube meets The Shopping Mall meets Flickr meets World of Warcraft – ok not that simple. We are really talking about non-game based, online spaces where people create new identities and become a part of a larger resident community. There are often no rules, only those set by the inhabitants themselves, this makes it a particular challenge for brands as we will see later (they don’t like to be told how to live!). Many of you would have heard of Second Life, with nearly 6 million registrations at the moment, but there are many others. Habbo is interesting as a simple isometric service for teens now with 76 million registrations and nearly 8 million regular users. Playstation 3 is about to launch ‘home’, a sort of virtual apartment suburbia connected to other PS3 players and EA games has just teamed up with Endemol to deliver what we sometimes call Mixed Reality (cross-over programmes between TV and virtual worlds). There are quite a few others such as there.com, Kaneva and many new kids growing up on the block such as multiverse, croquet or outback online. MTV Networks used the there.com engine to do some extremely interesting TV/Virtual World cross-over services like Laguna Beach, which I sadly won’t have time to talk about. Common to all of them are people using these shared worlds to interact with others around the globe, for hours at a time.

So what are the forces at work here, what is driving this change? Well I suppose there are two key ones. The first is the shift from humans wanting the internet to be more than the rather lonely and non-real time experience to one where as a “participant” they can have real time, collaborative and far richer immersive social interactions. Note I am careful to not call them, the audience – be aware that any media that still thinks of the residents of virtual worlds as audiences are doomed to failure. The second force at work here is to do with residents in worlds wanting to be far more active, creationist and imaginative. They are creating their own experiences versus passively consuming media, such as on TV or via YouTube for example. You have all heard of web 2.0 (blogs, wikis, flickr – the sharing web) well I like to think of virtual worlds as ‘part’ of web 3.0, the real time, co-creative web. It is still about sharing but in a far more natural setting – this is a space where you can walk up to someone and ask -Where can I buy some shoes and will you come shopping with me” versus typing the word shoes into some abstract search engine on the web and spending hours looking at flat pictures. A question I often get asked is, -Is this hype and something that will go away?” Absolutely not. I am old enough to have lived through the dawning of the web and early failed 3D world services, this is totally a part of that on-going evolution and this will now be here for good. The real question that should be asked, and perhaps the focus of my talk, is how are brands and professionals attempting to integrate into these spaces, will they create a virtual paradise or another dotcom burst?

The thing that’s common with all virtual worlds is the real time shared experience, and that should be the key to anyone thinking of setting up a branded space inside these worlds. Participants want to be just that, participants and co-creators. In a world like Second Life (now four times the size of San Francisco around 210 square miles) and where 99% of the content is made by the inhabitants, for a brand to simply plonk some souless buildings, or theme park, or even well displayed real world product falls way short of what the residents actually want. The message that we are getting from the inhabitants is for businesses to -play with me, don’t sell at me.” This is very important. These worlds are extremely ‘sticky’ and inhabitants invest a great deal of themselves in co-creating the environment and the numbers speak for themselves. In second life at the moment there are over 200,000 unique entrants per day spending an average of 4 hours in world – that’s nearly 1 million user hours, and with a population growing at around 30% per month you can see why many other virtual worlds will be popping up in the next few months and years to meet this demand.

Lets have a look at a very short video (which can also be seen on the Project Factory stand throughout the day) showing some of the social activities, the thing that is really driving demand in these environments.

SELF CUT VIDEO -a montage of a variety of experiences” (in background starting up SL if connectivity for demo)

So a brief taste of what goes on inworld, very experiential activities such as dancing, sport, ‘inworld tourism’, education, collaborative building and so on. These are often missed or ignored by the mainstream press. With my other hat on as Director of the Laboratory for Advanced Media Production at AFTRS I am also active in the educational areas in Second Life where collaborative, experiential teaching is growing into a powerful tool – a very vibrant and active community. But who are the real inhabitants? In Second Life it is far from being just young males. The average age is 33 and women constitute around 43% of the total. Interestingly the time spent gender wise is reversed. Of the total time spent by all participants, females account for 60%. Looking at the international split around 31% are from the USA, 48% Europe and 21% rest of the world. Europe is by far the fastest growing area now with growing numbers of English, French, Dutch and Germans so the servers (currently in San Fran and Texas are in the wrong place!). Back to the age question, one fascinating statistic I gleaned last week from Phil Rosedale, the CEO of the makers of Second Life, was that those over 60 years old spend 30% more time in Second Life than those aged 30. Lets try to pop into world now, hopefully, and have a quick two minute wander.

DEMO INWORLD. This space is called the Pond. The one that the Project Factory produced and built for Telstra BigPond. I am not sure who is around but regardless lets have a look at how Second Life works. That is me, the one with the wings and here I am at the main welcome area. Lets go for a short walk, if we meet anyone we may have a chat. It is important to have a welcoming or totally unique environment, look the ripples on the lake, palms, things to do, boating, dancing and of course a popular pastime, flying – (impro a bit here depending on audience reactions). I would like you to notice too how the advertising and brand presence is not ‘in your face’, more about that later. CLOSE DEMO.

Second life is not just about sex, money and griefing. Griefing, by the way, is a term used to describe irritating behaviour, which actually is extremely easy to control. Most of the stories you hear about ‘virtual terrorism’ is really a toxic combination of unprepared companies inworld and the media that likes to find ‘an angle’, just like the real world then. The Project Factory and other Second Life developers have many easy to implement strategies to reduce this to a minimum.

Onto money and opportunities for brands. For the moment it is about getting in there early (first mover advantage), learning about what works and collaborating with the existing resident communities. This both shows that you are ahead of the curve but also open to really having a direct relationship with your customers and most importantly learning from them. It is a way to reach and understand your existing clients and prepare for what will be a mass audience in a very short time. A recent inworld survey by CB News in partnership with RepÃƒÂ¨res asked over 1000 Second Life residents their opinion of real world brands and there were some surprisingly results. 66% believe that the presence of RL brands has a positive impact on SL and 45% of respondents even want more brands because they enhance and give more credibility to Second Life, a realism and make SL more interesting, by increasing the number of residents. But at the moment we are not talking about mass audiences. Successful brand presences, and two of the recent Project Factory builds in Second Life are in the top five, may have anywhere between 30-60 thousand unique visitors per quarter. These will seem like small numbers to some brand owners and advertisers, but, and here is where it gets very exciting, the inhabitants are spending anything between 15 minutes and 6 hours per visit to your brand! That figure is unheard of in almost any other media even more significant and important for those concerned with reach is that those residents are the most active in the blogosphere, and millions of impressions are generated outside these worlds – they tell of their lengthy experiences in the other social networks.

Shopping in virtual worlds is actually fun for the inhabitants and comes up as one of the most popular pastimes. The ability to browse products alongside your trusted friends is more akin to the mall than eBay of course so this is a real opportunity for those who want to attempt to make in or out of world sales. The more progressive companies are allowing consumers to co-design product and even order real world product from within the environment. A simple example. Very similar experiences to real life are being created in these worlds such the shared ‘media’ experience – listening to music, watching movies with others is pretty cool, you can chat and play-around with your fiends alongside the latest film. Dominos pizza realised this early and now allow you to order your ‘real’ pizza while you virtually watch movies with your ‘distributed friends’. Domino’s IT director Jane Kimberlin said “Second Life is where Domino’s customers are and therefore that’s where the pizza company needs to be too.”

How to make money? As is well publicised (in fact I can’t believe I am still talking about this) Linden dollars is the Second Life currency which can be converted into real world dollars. There are some businesses operating in Second Life that are earning real money selling virtual products. These include clothing, dance animations, selling or leasing property, buying even selling shares and the number of Second Life residents generating more than US$5,000 in monthly income has more than quadrupled to 116 in the past year, according to Linden Lab. Also brands who create product inside Second Life own the IP inworld and more importantly they retain it if they move it outside and create out of world, real product, so great news for inworld R&D. But selling things shouldn’t be your focus. It should be about integrating your brand and becoming a trusted addition inside this unique and vibrant social network. You must add value and not just build and run or build and not be around to welcome your visitors. There are way too many empty branded spaces in some virtual worlds. Lets see some of the brands that have already taken the plunge, this is a short edit of a longer video I compiled on the stand and it looks at a few recognisable names.

Quite a few recognisable brands there, so how are they doing?. Well on Thursday last week I went inworld and using the built in Search/Places facility which brings up the standardised traffic figures I looked at the ‘dwell’ traffic for each of them. Dwell is not just how many visits but how much of their inworld time they spent with each of the major brands. Also the inworld traffic measurement is the only real way to compare like with like which is why I am showing it to you. So here are the results.

Great news for Australia with BigPond and ABC (built by the Project Factory) in the top five and this is months after launch, so outside the hype curve. But why are some of the others so low? All those wonderfully designed, branded buildings with lots of things to do? Well to me a couple of the critical elements that many brands have missed are –
Firstly- Creating spaces that are just really nice to spend a long time in. Sounds simple but many corporate builds are just cold and too representational. They should be organic, of value and welcoming and where inhabitants can create their identities inside their own stories. Of particular note is the outback bar area of the Pond which is currently in the top ten of all second life brands itself on a ‘dwell’ basis, but more importantly it is part of a mix of features and functions that you need to create.
Secondly – A space where the inhabitants can create or contribute to the environment. So both The Pond and ABC have sandbox areas where residents (particularly new ones) learn to build and add things to the branded space. Also requests for changes from the visitors to the existing build should be taken seriously and acted on. Give them a sense of ownership of the space and they will thank you which will build trust.
Thirdly – Be authentic and talk to them at an equal level. Too many companies still talk down to their customers as their avatars do the ‘hard sales pitch’ thing. This is a real opportunity to show the human side to the brand, give it personality and again that insight will be endearing to the residents. A major consideration for many brands is to actually commit ‘real life’ people to be in the environment with the visitors 24/7. If you think you wont be able to collaboratively manage the community by factoring in the human resource follow-up, it might make sense not to start at all.

Advertising in these worlds are often seen as a big no, no from those inworld. Especially the old in your face, irrelevant, broadcast ad model. One thing we are experimenting with at the Project Factory is personalized and targetd advertising. This is not some Orwellian (or Minority Report) nightmare, more a way that the environment (at its crudest level ad hoardings) will change dependent on who is around them but there are many more subtle ad R&D experiments we are trailing. We, like many other developers, are learning as we go along and will never assume that this sort of functionality will prevail. An area that we definitely believe is here to stay is allowing residents to creatively interact with your brand or product. So let them co-design new product with you and listen to what they say about your existing products or services. Never before have brands had this opportunity to be so close to the consumer, you are in there with them, in real time, collaboratively.

Companies succeed in virtual worlds when they take much more of a lifestyle approach to their marketing. Whether you choose to go down this road and participate or not, Virtual Worlds will remain to be one of the most compelling ways we will interact socially and commercially in the future. The Project Factory’s virtual world services are also about merging the real with the virtual and creating experiences that are interactive, social and immersive. It is a very exciting time to be involved now at the dawning of this very real, virtual revolution. I hope that this brief talk wheted your appetite. If you want more come talk to us on our stand and check out the website listed here.

Thank you and time for a few questions?

and not mine but a great video about potential for brands (albeit slightly smoke and mirrors re: the interactions in this video) from Text100 and thousands of views on YouTube.